Judgment summary
This is a decision of the Upper Tribunal (Tax and Chancery Chamber) on a renewed application by Parvaiz Akhtar for permission to appeal against a First-tier Tribunal (Tax Chamber) decision released on 19 September 2025 (paragraph 1).
The FTT had refused permission to appeal on 27 November 2025 (paragraph 2). The Applicant renewed the application to the Upper Tribunal, permission was refused on the papers, and the Applicant requested reconsideration at an oral hearing held on 8 July 2026 (paragraphs 3-4).
Judge Vimal Tilakapala refused permission to appeal, concluding that none of the seven grounds advanced disclosed an arguable error of law in the FTT's decision (paragraph 69).
Background
The underlying dispute concerned VAT assessments for the periods 12/19 to 03/23 amounting to £29,199.19. These were best judgement assessments issued under s 73 of the Value Added Tax Act 1994, made as a consequence of the Applicant's failure to maintain sufficient records (paragraph 6).
The FTT found that the assessments were made to best judgement and that the Applicant had failed to satisfy the burden of proof on him to support his contention as to the inaccuracy of the quantum of the assessments (paragraph 7).
At the hearing on 8 July 2026, Mr Derek Smith of Rennie Smith Accounting appeared for the Applicant, with Ms Heather Sercombe observing for HMRC (paragraph 4). The day before the hearing, it became apparent that Mr Smith intended to call the Applicant's daughter as a witness. The Judge refused permission for that witness evidence to be given, citing the absence of formal notice, lack of explanation of the intended evidence, and the timing of the notification (paragraph 5).
Core dispute
The application concerned whether permission to appeal to the Upper Tribunal should be granted. An appeal to the Upper Tribunal from an FTT decision lies only on a point of law, under s 11 of the Tribunals, Courts and Enforcement Act 2007 (paragraph 8). The test applied was whether there was a realistic prospect of an appeal succeeding or some other good reason to grant permission, per Smith v Cosworth Casting Processes Ltd [1997] 1 WLR 1538 (paragraph 8).
The Applicant framed his case by way of seven numbered 'responses' to the FTT's refusal of permission, rather than by setting out discrete grounds of appeal (paragraphs 11-13). These concerned: a resolved procedural issue (Ground 1); whether HMRC used the most complete month's data (Ground 2); the FTT's rejection of the Applicant's explanation for till 'no sales' by reference to lottery scratch card sales (Ground 3); the FTT's treatment of the till-jamming explanation (Ground 4); alleged duplication of figures between July and September 2022 (Ground 5); alleged double counting and a 'missing sale' (Ground 6); and disagreement with the profit margin assumed by HMRC in the best judgement assessments (Ground 7).
Court findings
On Ground 2, the Tribunal found that the point about incomplete September 2022 data was not put to the FTT or to HMRC's witness, and Mr Smith could not confirm at the Hearing that it had been raised (paragraphs 17-24).
On Ground 3, the Tribunal held that the FTT's conclusion that the 'no sales' were 'not logical or credible' as explained by lottery scratch card sales was based on arithmetic comparison (over 1,400 lottery transactions against 529 no-sales) and was a conclusion the FTT was entitled to reach on the evidence (paragraphs 31-33).
On Ground 4, concerning the till jamming explanation, the Tribunal found this was an attempt to introduce evidence, via the Applicant's daughter, that should have been put before the FTT (paragraphs 40-42).
On Grounds 5 and 6, concerning quantum, the Tribunal held that failure to raise a point before the FTT cannot ordinarily amount to an error of law, and that inclusion of material in a hearing bundle does not mean the Tribunal is taken to have considered it, citing Adelekan v HMRC [2020] UKUT 244 (TCC) (paragraphs 45-46, 54).
On Ground 7, concerning profit margins, the Tribunal noted that Mr Smith had not been permitted to give expert evidence not directed by the FTT, and that two cash and carry receipts produced at the Hearing (dated 26 and 28 September 2022, for £397.56 and £359.33 ex VAT respectively) did not show the margin actually achieved by the Applicant, only the purchase price and recommended retail price of certain items (paragraphs 58, 61-65).
Outcome
The Upper Tribunal held that none of the seven grounds advanced disclosed any arguable error of law in the FTT's decision. Permission to appeal was refused (paragraph 69). The decision was signed on 30 July 2026 and issued to the parties on 31 July 2026.
Major issues / areas of contention
- Whether the FTT erred in law regarding the month's data used for the best judgement VAT assessment (Ground 2).
- Whether the FTT wrongly dismissed the Applicant's lottery scratch card explanation for till 'no sales' (Ground 3).
- Whether the FTT failed to properly consider the Applicant's till-jamming explanation (Ground 4).
- Whether HMRC's computation of the September 2022 figures duplicated amounts from July 2022 (Ground 5).
- Whether there was double counting of carried forward sales and confusion over a 'missing sale' (Ground 6).
- Whether the FTT failed to take into account documentary evidence as to profit margins, and whether Mr Smith was wrongly prevented from explaining that evidence (Ground 7).
- Whether the Upper Tribunal should admit new witness evidence from the Applicant's daughter at the permission hearing.